How thinking like a retailer helped this Oregon bank grow assets from $140M to $25B

Most speeches about banking aren't memorable for their emotional impact, but this keynote from Lani Hayward, EVP/Creative Strategies at Umpqua Bank, is an exception.

Speaking at The Financial Brand Forum, Hayward told the story of how Umpqua Bank grew their assets from $140 million to $25 billion in a little more than a decade. According to The Financial Brand, this was the top-rated session at the conference, and it’s easy to see why. Hayward’s creative efforts, combined with the dramatic growth of Umpqua Bank, are compelling.

When Hayward started at Umpqua they had just 6 locations and were a distant third in market share. “Honestly,” Hayward says, “the cards were stacked against us. … We knew we were not going to out-rate [our competitors], we knew we were not going to out-resource them, or out-advertise them.”

Because of this, Hayward and her team saw that Umpqua needed a completely new strategy. She says, “We needed to find a way to significantly differentiate ourselves enough to have people in this little town drive past two or three other locations just to get to us.”

To figure out how to differentiate themselves, Hayward and her team decided to start by asking a simple question: “What industry are we really in?” After wrestling for an answer, they decided that they were in the products and services industry, which meant that they needed to replicate the experience of visiting retail stores.

As a result, Umpqua hand-selected seven associates and sent them to study different retailers. They analyzed all the ways their bank could emulate the industry’s best practices, and they came away with several innovative ideas — two of which we’ll talk about here.

First, they built stores rather than branches. Just like typical retailers, they moved all backend activity out of sight, the way the typical retailer does. They also created physical representations of their products, allowing their customers to walk in and browse everything they had to offer. The whole experience is open, light, and customer centric.

Second, Hayward and her team took an innovative approach to becoming an active brand in the community. For example, they created a branded ice cream truck and gave away free ice cream. They also created lemonade stand kits that allowed kids to start their own businesses. These efforts generated press and established Umpqua as a cool bank, which in turn drove up business. Hayward even tells about how one kid, unsolicited, told her that Umpqua was “pretty cool, for a bank.” This is how to attract the next generation of customers.

Altogether, in the years following their pivot toward emulating the retail industry, Umpqua grew tremendously and acquired several other banks. As Hayward says, now Umpqua is looking to improve the entire customer experience. She says, “we look to bridge the physical … with the digital, until there’s no gap at all.” In other words, Umpqua is looking for ways to differentiate themselves in the digital age and beyond.